NEW YORK – U.S. stocks closed flat Tuesday as investors locked in profits after five straight sessions of gains in blue chips, a day before the Federal Reserve's meeting on interest-rate policy.
The Dow Jones industrial average dipped 3.90 points, or 0.03 percent, to end at 13,309.07, after earlier falling as much as 75 points.
The Standard & Poor's 500 Index slipped 1.76 points, or 0.12 percent, to finish at 1,507.72. But the Nasdaq Composite Index edged up 0.80 of a point, or 0.03 percent, to close at 2,571.75.
After starting the session sharply lower, indexes clawed their way back as investors saw the decline as the first buying opportunity in more than a week. Resilience in the transportation sector also curbed the market's fall.
A smattering of earnings disappointments helped cool enthusiasm for stocks. Shares of insurance broker Marsh & McLennan Cos. (MMC), financial advisory firm Lazard Ltd. and online travel agency Expedia Inc. all dropped after the companies posted results that missed analysts' forecasts.
Stocks have rallied for most of April and May on robust first-quarter earnings and a wave of major takeover deals.
"It looked like early this morning that today was going to be a down day, but the buy-the-dip crowd came in quickly,"said Joe Saluzzi, co-manager of Themis Trading in Chatham, New Jersey.
"There has just been a steady rise off of every intraday dip we've had. What it's going to take to break that trend is a major news event — it can't just be selling off for the sake of selling off," Saluzzi said.
The Fed's monetary policy committee is set to make a decision on official rates and release an economic outlook statement Wednesday, adding to the market's cautious mood.
The benchmark short-term U.S. interest rate, the federal funds rate for overnight bank loans, is forecast to stay at 5.25 percent at least until September.
Shares of Marsh & McLennan shed 2.5 percent to $31.13, while Lazard's stock declined 1 percent to $53.35, both on the NYSE. Conglomerate Tyco International Ltd. 's shares fell 2.1 percent to $32.05, after the company reported lower quarterly earnings. Tyco's results beat analysts' estimates, thanks to a lower tax rate.
Expedia fell 2.5 percent to $24.20 on the Nasdaq.
A bright spot was Hewlett-Packard Co. (HPQ), which ranked among the biggest gainers in the Dow and the S&P 500 after the printer and personal computer maker raised its forecast for second-quarter revenue and earnings.
HP's stock shot up 2.8 percent to $45.01. Earlier, HP climbed to $45.13, its highest level since November 2000, on the NYSE.
Limiting the S&P 500's decline was Exxon Mobil Corp. (XOM), which reversed earlier losses and rose 0.7 percent to $81.38 as U.S. oil futures gained. NYMEX June crude advanced 79 cents to settle at $62.26 a barrel. Oil prices rose on supply concerns following a forecast that a major hurricane could strike the U.S. Gulf Coast this year and after rebel attacks on a pipeline in Nigeria.
Shares of Motorola Inc. (MOT) fell 2.1 percent to $17.70 after investor Carl Icahn failed in his bid to win a seat on the mobile phone maker's board.
The National Association of Realtors cut its U.S. housing forecast again, saying that stricter lending standards and a decline in subprime mortgage origination has cut down on speculative buying and hurt prices.